Tax Practitioners Board v Williams

Federal Court of Australia|2023-02-08|Before: Charlesworth J

Tax Practitioners Board v Munro [2012] FCA 1338; 91 ATR 505 Tax Practitioners Board v Shanahan [2013] FCA 764; 94 ATR 356 Vaysman v Deckers Outdoor Corporation Inc [2011] FCAFC 17; 276 ALR 596

BETWEEN: TAX PRACTITIONERS BOARD Applicant

AND: NATHAN LUKE WILLIAMS Respondent

THE COURT DECLARES THAT:

The respondent contravened s 50-5(1) of the Tax Agent Services Act 2009 (Cth) (Act) by providing tax agent services for fee or reward whilst not a registered tax agent within the meaning of the Act on 73 occasions (civil contraventions).

THE COURT ORDERS THAT:

Pursuant to s 50-35(2) of the Act, for the civil contraventions the respondent is to pay pecuniary penalties to the Commonwealth totalling $80,000.00. Such penalties to be paid on a date to be fixed.
Pursuant to s 70-5(1) of the Act, the respondent is restrained from providing or offering to provide any tax agent services (as defined in the Act) for fee or reward, unless the respondent is registered to provide those services under the Act.
The parties have liberty to apply to vary or revoke the order in paragraph 2, either: (a) after the passage of 10 years from the date of the order; or (b) in the event that s 50-5(1) of the Act is amended or repealed.
For the contempt described in paragraph 2 of the orders made on 13 October 2021, the respondent be imprisoned in a correctional facility for 10 days, commencing on a date to be fixed.
The matter be set down for further submissions at 10:00am (ACDT) on 22 March 2023 as to: (a) the time by which the pecuniary penalties imposed by paragraph 1 are to be paid; and (b) the time of the commencement of the sentence referred to in paragraph 4 and the manner in which the respondent is to be taken into custody.
The respondent is to pay the applicant's costs, to be taxed on a party-party basis if not agreed.
Liberty to apply. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

CHARLESWORTH J 1 The respondent Mr Nathan Luke Williams was previously a registered tax agent within the meaning of the Tax Agent Services Act 2009 (Cth) (TAS Act). His registration lapsed on 1 December 2018. 2 After the lapse of his registration, Mr Williams continued to prepare and lodge tax returns for tax payers in Australia for fee or other reward. By doing so, he committed multiple contraventions of s 50-5(1) of the TAS Act (civil contraventions). 3 On 8 June 2021, the Tax Practitioners Board commenced this action seeking the imposition of civil penalties and other relief in connection with Mr Williams' contraventions. By its originating application the Board also sought interlocutory relief in the form of an injunction restraining Mr Williams from preparing and lodging tax returns for tax payers for fee or reward whilst not registered as a tax agent. On 18 June 2021, the Court granted the interlocutory injunction with Mr Williams' consent (Injunction). 4 By a statement of charge dated 29 September 2021, the Board alleged that Mr Williams was in contempt of the Injunction by preparing and lodging seven income tax returns for four different tax payers on 5 July 2021, 22 July 2021 and 23 July 2021. 5 As explained below, Mr Williams admitted the conduct constituting the contraventions of the TAS Act as well as the conduct constituting the contempt. On 13 October 2021, Mr Williams was adjudged guilty of contempt as alleged in the statement of charge. He did not contest the question of his guilt. 6 In these reasons the Court assesses the civil penalties and other remedies to be imposed for the civil contraventions and the appropriate punishment for the contempt. 7 I have concluded that: (1) there will be an order that Mr Williams pay civil penalties in an amount totalling $80,000.00 for his contraventions of s 50-5(1) of the TAS Act; (2) there will be a final injunction in the terms sought by the Board, subject to Mr Williams having liberty to apply to vary or revoke the injunction not earlier than 10 years from today; and (3) for his contempt of this Court, Mr Williams will be sentenced to a term of imprisonment in a correctional facility for 10 days, such term to commence on a date to be fixed after the expiry of the period in which he may appeal from the Court's orders.

Declarations 8 Mr Williams does not oppose the declaratory relief sought on the originating application. It is appropriate to make those declarations so as to formally record the Court's findings constituting the contraventions based on the material before me: see Cruse v Multiplex Ltd (2008) 172 FCR 279 (at [53]) and the cases there cited.

Principles 9 The object of the TAS Act is to ensure that tax agent services are provided to the public in accordance with appropriate standards of professional and ethical conduct: TAS Act, s 2-5. To advance that objective, the statute erects a regime relevantly comprising the establishment of the Board, the general prohibition of the provision of specified tax advisory or agency services, the requirement for the registration of tax agents and advisors (Part 2), the prescription of a Code of Professional Conduct regulating the behaviour of those who are registered (Part 3) and a disciplinary regime to address breaches of the Code, including provisions for the termination of registration (Part 4). 10 Division 50 of Pt 5 of the TAS Act is titled "Civil Penalties". It contains "civil penalty provisions", including s 50-5(1). It provides: You contravene this subsection if: (a) you provide a service that you know, or ought reasonably to know, is a tax agent service; and (b) the tax agent service is not a BAS service or a tax (financial) advice service; and (c) you charge or receive a fee or other reward for providing the tax agent service; and (d) you are not a registered tax agent; and … Civil penalty: (a) for an individual - 250 penalty units; and (b) for a body corporate - 1,250 penalty units. 11 Subject to exclusions that do not apply, s 90-5 of the TAS Act defines the phrase "tax agent service" as any service: (a) that relates to: (i) ascertaining liabilities, obligations or entitlements of an entity that arise, or could arise, under a taxation law; or (ii) advising an entity about liabilities, obligations or entitlements of the entity or another entity that arise, or could arise, under a taxation law; or (iii) representing an entity in their dealings with the Commissioner; and (b) that is provided in circumstances where the entity can reasonably be expected to rely on the service for either or both of the following purposes: (i) to satisfy liabilities or obligations that arise, or could arise, under a taxation law; (ii) to claim entitlements that arise, or could arise, under a taxation law. 12 The importance of s 50-5 hardly needs stating. The prohibition against persons providing tax agent services for fee or reward without being registered as a tax agent is the lynch pin in the regime. It is the requirement to hold a license (in the form of registration) that subjects those who provide taxation services to standards of behaviour contained in the Code and enforceable by the Board. That requirement ensures that defined tax services are only provided by persons who are fit and proper to provide them. The conditions of fitness and propriety require not only that the registrant holds the necessary knowledge and qualifications, but also possesses personal characteristics that are not inimical to the statutory purpose. Conduct that contravenes s 50-5(1) is conduct that undermines the efficacy of the whole of the regime. 13 The Board has standing to apply to this Court for an order that a person pay a pecuniary penalty to the Commonwealth for contravention of a civil penalty provision: TAS Act, s 50-35(1). If satisfied that a person has contravened a civil penalty provision, the Court may order that the person pay, for each contravention, a pecuniary penalty that the Court determines is appropriate, not exceeding the maximum amount specified for the provision: TAS Act, s 50-35(2). The maximum amount specified for a contravention of s 50-5(1) of the TAS Act is 250 penalty units for an individual. That equates to $52,500.00 for each contravention occurring prior to 1 July 2020 and $55,000.00 for each contravention occurring after that time; Crimes Act 1914 (Cth) s 4AA(1). 14 The purpose of a civil penalty is to protect the public interest by deterring future contraventions of the TAS Act by the contravener and by others: Commonwealth v Director, Fair Work Building Industry Inspectorate (2015) 258 CLR 482, French CJ, Kiefel, Bell, Nettle and Gordon JJ (at [24] and [55]). 15 The power to impose a penalty is discretionary. It is cast in relevantly the same terms as that conferred under s 546 of the Fair Work Act 2009 (Cth), the scope of which was recently discussed by the High Court in Australian Building and Construction Commissioner v Pattinson [2022] HCA 13; 399 ALR 599. As Kiefel CJ, Gageler, Keane, Gordon, Steward and Gleeson JJ there observed, it is "like any discretionary power conferred by statute on a court, to be exercised judicially, that is, fairly and reasonably having regard to the subject matter, scope and purpose of the legislation"(at [40]). Their Honours emphasised that when imposing a penalty, the Court acts for the purpose of protecting the public interest by deterring future like contraventions: Pattinson (at [48]). Retribution has no part to play. 16 In determining the appropriate penalty the seriousness of the contravention is a relevant consideration, however, it is not to be regarded as a controlling factor: Pattinson (at [58]). As the majority said in Pattinson, "[c]onsiderations of deterrence and the protection of the public interest, justify the imposition of the maximum penalty where it is apparent that no lesser penalty will be an effective deterrent against future contraventions of a like kind" (at [50]). The maximum penalty is not otherwise to be utilised as a "yardstick" or as the uppermost end of a scale by which contraventions may be graded according to seriousness with corresponding monetary penalties: Pattinson (at [51]). 17 There must be a "reasonable relationship" between the theoretical maximum and the penalty imposed, however, as emphasised in Pattinson (at [56] - [57]), the reasonableness of that relationship is to be established by reference to the circumstances of the contravener as well as the circumstances of the conduct constituting the contravention. Either of those circumstances may have a bearing on the need for deterrence in the particular case. They may overlap, particularly in cases where the contravening conduct is accompanied by a deliberate or strategic state of mind. The seriousness of a contravention and the associated need for deterrence may be assessed not merely by reference to the nature of the physical acts constituting the contravention, but by the accompanying mental attitude: Pattinson (at [57] - [58]).

The contraventions 18 The parties prepared a signed statement of agreed facts for the purposes of s 191 of the Evidence Act 1995 (Cth). Mr Williams was not legally represented at the time that he executed the statement, however he did have legal representation at the time of the hearing. When the hearing as to penalty commenced, he was granted an adjournment of several weeks, including for the purpose of obtaining legal advice about all of his prior admissions in this proceeding and their consequences. After the adjournment period (and at a time when he was legally represented), Mr Williams did not submit that the statement of agreed facts had been improperly procured, nor did he make any submission about the quality of his consent to the orders granting the Injunction, nor to the quality of his admission of the conduct constituting the contempt. Mr Williams had earlier been advised by this Court of his right to make a claim of privilege against self-incrimination or self-exposure to penalty. Whilst he later said that he did not fully understand those concepts at the time that he was self-represented, through his Counsel he did not make any submission that the Court should or could not act on his prior admissions. 19 To the contrary, Mr Williams has relied upon his admissions and cooperation as a consideration relevant to the imposition of penalties and as to the consequences that should follow from his breach of the Injunction. 20 The effect of those admissions is that it has been unnecessary for the Court to adjudicate Mr Williams' liability in a contested trial. I will return to the significance of his cooperation in the assessment of the appropriate response. 21 On the basis of the agreed facts, I find that the civil contraventions occurred between 1 July 2019 and 23 September 2020. In that period there were days on which Mr Williams lodged one or more tax returns for 51 named taxpayers for fees ranging between $50 and $400. The number of tax returns prepared and lodged by Mr Williams totals 73. The fees he received amount to $7,300.00. That is not a significant amount in terms of personal income, nor does it evidence the conduct of a full time business based on the contravening conduct, and I take those matters into account. 22 It is not disputed that by preparing and lodging tax returns on behalf of tax payers for fee or reward whilst not being registered as a tax agent, Mr Williams on each occasion provided a "tax agent service" to each individual tax payer within the meaning of s 90-5 of the TAS Act: Tax Practitioners Board v Shanahan [2013] FCA 764; 94 ATR 356; Tax Practitioners Board v Li [2015] FCA 233; 98 ATR 603; Tax Practitioners Board v Munro [2012] FCA 1338; 91 ATR 505. 23 Evidence of the circumstances in which the contraventions occurred is otherwise contained in affidavits relied upon by the Board, as well as affidavit and oral evidence given by Mr Williams. Subject to rulings that need not be repeated here (and parts that were withdrawn), the following affidavits were read: (1) Mingma Sherpa affirmed 7 June 2021; (2) Mr Williams of 20 December 2021; (3) Mr Williams 21 January 2022; (4) Armae Rose Ballon affirmed 28 April 2021; (5) Sara Rose Bingapore affirmed 27 April 2021; (6) Ana Carolina Blanes affirmed 25 March 2021; (7) John Roger Heritage affirmed 19 May 2021; (8) Matthew Bernard Lambret affirmed 27 April 2021; (9) Joanne Stephanie Ribbons, affirmed 27 April 2021; and (10) Mandeep Singh affirmed 2 May 2021. 24 The contraventions must be considered having regard to all of the circumstances, which for the most part are not disputed. The following findings are based largely on the affidavits and on oral evidence given by Mr Williams in cross-examination, the statement of agreed facts and affidavits of the Board's deponents insofar as they provide additional context. The respondent's witnesses were not cross-examined and I have accepted their evidence at face value. With some exceptions I have also accepted the facts asserted by Mr Williams. However, as explained later in these reasons, I do not consider the facts support some of the critical inferences for which he contends.

Findings 25 The contraventions occurred on 43 dates between 1 July 2019 and 23 September 2020. Mr Williams was about 35 years old over that period. 26 Mr Williams has a Bachelor of Commerce and a Bachelor of Business (e-business) conferred in 2008 and a Graduate Diploma of Chartered Accounting completed in 2011. He was registered as a tax agent from 25 November 2015 for a three year period. In accordance with the requirements of the TAS Act he submitted annual returns on 28 November 2016 and 15 November 2017. On 27 November 2018, he submitted a registration renewal application, by which he sought to extend his registration for a further three years (renewal application). He later withdrew the renewal application with the consequence that his registration ceased, effective from 1 December 2018. 27 In the period before he withdrew the renewal application, Mr Williams was involved in dealings with the Board concerning his conduct as a tax agent. Between at least August 2017 to January 2018. Mr Williams had been subject to investigation and disciplinary action by the Board following complaints from tax payers that he had received their tax refunds but had not promptly provided them with the money. In January 2018, following the investigation, Mr Williams was subjected to an order of the Board, under s 30-20 of the TAS Act, that he not receive income tax refunds into his own account and that he undertake a course of training and education. In cross-examination, Mr Williams admitted that he had not complied with the order to not receive income tax refunds into his own account on two occasions. Each admitted occasion involved the receipt of tax refunds owing to deceased relatives which he said was done in order to assist with the administration of their estates. Whilst the monies were not received on behalf of members of the general public, the conduct of receiving them was nonetheless in breach of the Board's order and, I conclude, knowingly so. 28 Mr Williams denied that he had received tax refunds into his account on behalf of a different entity (not being a relation) in breach of the Board's order. I make no finding as to whether or not that in fact occurred. However, I am satisfied that in 2019, Mr Williams was aware that the Board was alleging that he had engaged in conduct in breach of its previous orders, including his admitted conduct of receiving into his own account the tax refunds of the two deceased relatives. I am satisfied that he was aware of the Board's intention to seek to have his registration terminated on the basis of that conduct as well as other allegations involving breach of the Code. 29 On 12 July 2018, the Board issued a letter to Mr Williams informing him that it was conducting another investigation into his conduct. By letter dated 4 December 2018, Mr Williams was notified of the outcome of that investigation and of a decision of the Board to terminate his registration effective from 8 January 2019. The Board's decision was based on its assessment that Mr Williams ceased to meet the tax practitioners registration requirements under s 20-5(1) of the TAS Act, because he did not meet the description of a fit and proper person. After receiving that correspondence Mr Williams withdrew his renewal application on 6 December 2018. Submissions before me proceeded on the basis that the withdrawal caused the registration to cease as at 1 December 2018 and that it was therefore unnecessary for the Board to action its decision to terminate it. 30 To be clear, I make no findings of prior contravention of the Code by Mr Williams other than in respect of conduct admitted by him in this proceeding as identified in these reasons. The relevance of his prior dealings with the Board will be addressed later in these reasons. 31 The first contravention occurred about six months after Mr Williams' registration ceased. 32 The Board received information concerning some of the early contravening conduct from the Australian Taxation Office. On 20 December 2019 the Board wrote to Mr Williams in the following terms (the cease and desist letter): POTENTIAL LEGAL ACTION - Breaches of the Tax Agent Services Act 2009 The Tax Practitioners Board (the Board) is responsible for ensuring tax practitioner services are provided to the public in accordance with appropriate standards of professional and ethical conduct. The Board was established under the Tax Agent Services Act 2009 (the TASA) to administer the registration of tax practitioners and investigate conduct that may breach the TASA. The Board is aware that you are engaging in conduct prohibited by the TASA, and is particularly concerned that: • you are charging or receiving a fee or other reward for providing tax agent, BAS agent or tax (financial) advice (tax practitioner) services when you are not a registered tax practitioner nor may you be working under the supervision and control of a registered tax practitioner • you may be advertising you will provide a tax practitioner service when you are not a registered tax practitioner • you are representing yourself as a registered tax practitioner when that representation is untrue. An extract of the legislation relating to conduct prohibited by the TASA is provided in Attachment A. What you must do to avoid legal action You must immediately stop any conduct and amend or remove any advertising/representation referred to above. If you are providing tax practitioner services, you must also cease such activity whilst you remain unregistered. We expect written confirmation of the above by 24 January 2020. Alternatively, you must provide reasons as to why you think your conduct is not a breach of the TASA. Failure to do so will lead to this matter being escalated for further action. This may include the Board commencing Federal Court proceedings for injunctions and/or penalty orders against you. 33 The letter went on to provide extracts of provisions of the TAS Act, including s 50-5(1), and referred to the maximum civil penalties payable with respect to its contravention. 34 Mr Williams responded via email on 24 January 2020 in the following terms: I refer to your letter dated 20 December 2019. I confirm: 1. I do not charge or receive a fee or other reward for providing tax agent, BAS agent or tax (financial) advice services and if I have done so previously have stopped that conduct. 2. I do not advertise or represent myself as a registered tax practitioner and if I have done so previously it was in error and I have taken steps to ensure I do not advertise or represent myself as a registered tax practitioner. Thank you for providing the opportunity to clarify my present position to the Tax Practitioners Board. I would be grateful if you would confirm receipt of this communication and that this matter need not be escalated. 35 In cross-examination, Mr Williams admitted that the assertions in that email were not true at the time and that he had continued to provide tax agent services for a fee over the months of July and August 2020 on 40 occasions. That conduct occurred despite his receipt of the cease and desist letter and notwithstanding that he had falsely told the Board that he was not engaging in any such conduct. 36 Mr Williams prepared tax returns by obtaining login details of the tax payers' MyGov accounts and completing the returns on their behalf online. He told the Court that the tax payers' MyGov accounts held a range of pre-populated information including taxable income derived. He acknowledged that the process of lodging a return is very easy for a trained person. 37 Mr Williams said that the primary reason for his prior contravening conduct was financial pressure. He said that he felt overwhelmed by the stress of operating his own business, events in his personal life including the birth of his first child, his responsibilities as treasurer of his cricket club and his long working hours. He said that in 2019 he and his wife fell behind in their expenses and that he completed the tax returns for a fee to contribute to the family's finances. The evidence concerning Mr Williams' financial situation during the period of the contraventions is otherwise expressed at a general and uninformative level. The extent to which he was "behind" with expenses is not specified, and the evidence does not demonstrate that there were no means to resolve the difficulties other than by engaging in conduct that contravened the law. 38 Following the lapse of his registration, Mr Williams did not advertise his services but acted on requests from former clients. I do not consider those requests themselves were unsolicited. Mr Williams told the clients that he was no longer registered as a tax agent, by way of this open text message: Hi You may get a letter from the ATO in the next day or so to say that I am no longer registered as a tax agent. Due to a number of issues that I have had over the last few years which seem to be leading to an increase scrutiny on my clients I am no longer registered as a tax agent. I am still working as an accountant, but I can't charge for lodging tax returns. I understand that this may cause some issues for you, and I appreciate all of the support you have given me and my business, so I would like to catch up with you if you are able to in the next couple of weeks to discuss the options from here. I am open to questions, and if you want to discuss urgently, I will be available by phone. Thanks, Nathan 39 It may be observed that Mr Williams' text message invited tax payers to contact him to discuss their options. The option of Mr Williams preparing the tax returns for fee or reward was the option that was ultimately pursued. In his affidavit Mr Williams said that when he notified the tax payers that he was no longer registered they would still ask if he could assist them. He told his former clients that he was prepared to assist them because he "did not want to let them down". He went on to say: "However, I now understand that in doing so I was doing the wrong thing and I simply should have helped them without asking for any money in return, or referred them to another registered tax accountant". He later repeated that he realised "now" that he should not have asked for money in return for lodging tax returns after his registration had lapsed. 40 In cross-examination Mr Williams acknowledged that he could have assisted those persons by preparing their returns without charging for it. He accepted that the real reason for the contravening conduct was that he needed the money. 41 I do not accept that Mr Williams' appreciation that his conduct was wrong arose sometime after the contraventions occurred. The suggestion that he only gained an appreciation that the conduct was wrong at some unspecified later time is against the weight of evidence concerning his prior dealings with the Board. Those dealings make it plain that he was well aware of the need to be registered. It beggars belief that Mr Williams did not appreciate at the time of the contraventions that he should not have charged for the preparation of the returns until a later time. I do not accept that he has otherwise had a recent epiphany that what he had done was wrong. 42 I consider these aspects of Mr Williams' affidavit evidence amount to an attempt to deny any consciousness of wrongdoing and to otherwise downplay the seriousness of the mental attitude accompanying the contraventions. To some extent that was addressed by his acknowledgments in cross-examination but it remains that there was an attempt in his sworn affidavit evidence to suggest a degree of naivety that I simply cannot accept. 43 Mr Williams accepted in cross-examination that from a financial perspective his family was still struggling. He said that neither he nor his wife had a high income. He said that he had reconstructed his finances so that his wife now receives his salary, that she pays all of their household debts and that he only receives a small amount by way of an allowance. 44 In the course of cross-examination Mr Williams admitted previous wrongful conduct, including conduct that resulted in a conviction for a criminal offence involving dishonesty in 2017. That offence involved the dishonest taking of property without consent from the Murray Towns Cricket Association of which he was the treasurer. The prior criminal offending was fairly proximate to the civil contraventions presently under consideration and occurred at a time when Mr Williams was working as a registered tax agent. 45 Mr Williams further admitted that whilst working as a registered tax agent there had been a substantial delay between the receipt of at least 11 tax payers' returns into his trust account and the payment of the money to them and that in some instances the money was not paid until the tax payer had made a complaint. He admitted that he was subject to an order of the Board in 2018 prohibiting him from holding money on behalf of clients, and that he had breached the order, at least in relation to the tax returns of the deceased relatives. 46 He further admitted that he had falsified information on a Business Activity Statement (a finding upon which the Board's decision to terminate his registration was based) although he denied doing so to benefit himself. 47 At the conclusion of cross-examination there was the following exchange: Mr Follett: What I want to suggest to you, Mr Williams, is that historically and also in relation to the instant contraventions now before the court including the contempt, that when you are experiencing financial difficulties you resort to conduct you know to be unlawful to access funds that you know not to be yours. Correct? Mr Williams: I would agree with that. 48 Mr Williams was not re-examined on his unqualified response. 49 In assessing that admission, I have not overlooked that the contravening conduct in the present case did not in fact involve Mr Williams accessing funds being the property of another person and so I would not interpret his response to go so far. It is nonetheless apparent that Mr Williams has previously engaged in conduct in contravention of the law and/or the Code and that he has sought to explain that conduct by reference to his past financial difficulties. Financial difficulties are now put forward as the explanation for the contraventions of s 50-5(1) of the TAS Act. It is a poor explanation. The true cause of the contravening conduct was Mr Williams' chosen means of addressing the difficulties, involving knowing contraventions of the law. 50 Mr Williams was referred to a clinical psychologist in or around March 2017. However, through his Counsel, he did not ask the Court to find that the conduct giving rise to the contraventions was explained in any way by a recognised and diagnosed mental disorder or any other medical condition that had subsequently been diagnosed and managed. Foreshadowed reliance on a medical report and other evidence asserting explanations for Mr Williams' behaviour was later withdrawn, including some assertions by Mr Williams on the same topics. As they are not relied upon it is unnecessary to mention them here, but the non-reliance on that evidence leaves the Court with an explanation for the conduct that is lacking in detail and otherwise inadequate. 51 The admitted evidence does not reliably support any findings about any medical basis for the referral to the psychologist, nor as to the nature of any treatment Mr Williams has received or the effectiveness of any such treatment. It follows that there is insufficient evidence to prove a causative connection between any psychological condition and the contravening conduct. The case is not one in which prior conduct may be explained by an unmanaged or undiagnosed condition that is now controlled or overcome by treatment so as to diminish Mr Williams' culpability or reduce the need for specific deterrence.

Present day circumstances 52 Counsel for the Board did not submit that Mr Williams is presently a man of significant financial means. He was not cross-examined on his brief evidence concerning his income and assets. The evidence as to his assets is to the effect that he is the owner of a home subject to a mortgage with equity of about $65,000.00, a modest car and a small boat. 53 At the time of the hearing Mr Williams had casual employment as a fish processor on the Coorong with variable hours. He earns (on average) between $1,000.00 and $1,500.00 per fortnight before tax. His wife works part-time. He asserts that the total household income is approximately $3,000.00 per fortnight. They have debts owing to relatives, attributable to the purchase of a car and Mr Williams' legal fees. There is no discrete evidence of any income support in the nature of family payments or otherwise provided by reference to his two children. 54 Mr Williams said that he feared that the imposition of civil penalties would have a substantial impact on his financial situation and, in turn, would affect his mental health and relationships with family members. He acknowledged that his financial arrangement with his wife did not prevent him from providing tax agent services for a fee in a practical sense. However, he said that if he were to engage in such conduct it would end in divorce and the loss of his family. 55 There is little detail as to the family's day to day expenses and how their objective financial circumstances might differ from that persisting at the time of the contraventions. 56 Mr Williams told that Court that after commencing employment as a fish processor in August 2021 he has got most things in his life "back in control" and that he had "space in his head" to deal with other issues with the help of his psychologist. However, the evidence relied upon does not specify what those issues are. It is insufficient to satisfy me that there has been a fundamental shift in Mr Williams' mental state or attitude. 57 In cross-examination Mr Williams said that at the time of the civil contraventions he was still engaged in a financial role and had constant access to his mobile phone, but that in his present employment "obviously hands full of guts of guts of fish, I can't be using my phone". He also suggested that there were phone connectivity issues in the place where he worked. 58 I do not accept that Mr Williams has phone connectivity issues of a kind that would preclude him from using his phone to prepare and lodge tax returns online, at least from his place of residence. Nor do I accept that his employment as a fish processor otherwise presents a practical impediment to further contraventions. In his affidavit he states that he resides in the City of Murray Bridge and that his casual hours at the fish processing plant are variable. Many of the contraventions presently under consideration occurred at times outside of regular working hours, including weekends and he has acknowledged that a tax return may be prepared online with ease. 59 As explained below, I consider the aspects of Mr Williams' evidence about practical impediments to future contraventions to be as unimpressive as they are concerning. 60 Mr Williams said that he does not presently work in the tax industry and has no future intention to do so again. 61 His wife did not give evidence.

Consideration 62 Having regard to the evidence as a whole I place very little weight on Mr Williams' stated intention to not work in the financial sector again. 63 On my assessment of the evidence there is a very high risk that he might again contravene the TAS Act notwithstanding that stated intention. That is because Mr Williams has shown in the past that he has succumbed to financial pressure by contravening the law. I am not satisfied on the limited evidence before me that his mental state has altered to such a degree that the contravention of the TAS Act will not present itself to him as a solution to his problems, real or perceived. 64 Mr Williams has been highly cooperative in this proceeding including by consenting to orders that progressed the matter to a hearing on penalties as promptly as the circumstances permitted. In addition, he executed the statement of agreed facts for the purpose of s 191 of the Evidence Act and did not seek to cross-examine the Board's witnesses. His conduct in those respects is commendable because it has reduced the length of the hearing and the need for the Board's witnesses to give oral evidence. 65 Whilst I have taken that aspect of Mr Williams' conduct into account, in my view the case is one in which cooperative conduct should be given less weight. In the ordinary course, cooperation on the part of a respondent in Mr Williams' position may fairly indicate a degree of insight and contrition on the part of the person concerned and so support a conclusion that there is a lesser need for a civil penalty to deter future contraventions. In the present case, however, the cooperative conduct occurred concurrently with yet further contraventions. Unusually, Mr Williams consented to orders for the grant of the Injunction and then proceeded to ignore the Court's order by engaging in conduct that constitutes further contraventions of s 50-5(1) (as well as contempt of the Court's order) within a very short timeframe afterward. To my mind, the cooperation exhibited by Mr Williams cannot be readily regarded as a manifestation of him gaining a greater degree of insight into the wrongfulness of his conduct. In the unique circumstances of this case, whilst his cooperation is relevant, it does little to assure the Court that there is a diminished risk of further contraventions. I emphasise that contravening conduct occurring after this proceeding commenced is not to be employed as a basis for increasing the civil penalty that should otherwise be imposed. The Court's focus is fixed on those contraventions upon which the originating application is based. However, in assessing the need for specific deterrence the Court may have regard to circumstances that tell against the usual inferences that might otherwise be drawn from the fact of cooperative behaviour as a mitigating factor. I will deal separately with the aspect of cooperation in the context of assessing the appropriate punishment for contempt, a context in which different legal principles apply. However, for the purposes of assessing civil penalties I am not satisfied that the evidence of cooperation in the litigation supports a conclusion that there is a lesser need for specific deterrence in relation to future contraventions of s 50-5(1) of the TAS Act or like provisions. 66 As I have mentioned, the circumstances of the contraventions are such that Mr Williams consciously contravened the law because he felt under financial pressure having fallen behind in his expenses and because he considered engaging in the contraventions would provide part of the solution. Mr Williams continues to struggle financially and on the material before me I do not consider that the objective circumstances he put forward to explain his conduct have been resolved. The circumstance that his wife controls his personal expenditure by providing him with a small allowance may well serve to reduce their household expenses. However, his evidence is lacking in sufficient detail to demonstrate that the earlier personal stressors are no longer present or will not again arise. 67 I am not satisfied that the mental attitude that persisted throughout the contravening period is one that has fundamentally changed. Not only did Mr Williams consciously ignore the requirements of the TAS Act that were well known to him, he persisted in the conduct even after it was made known to him that his wrongdoing had come to the Board's attention. He then persisted in the contravening conduct whilst at the same time falsely representing to the Board that he had not contravened the TAS Act and that if he had engaged in contravening conduct it has ceased. He was impervious to the Board's correspondence alerting him to his contraventions and the foreshadowing of litigation of this kind. 68 Whilst Mr Williams informed the tax payers that he was no longer registered as a tax agent, his correspondence with them shows that he did not in fact regard the absence of registration to be an obstacle to acting for fee or reward. 69 Mr Williams attempted to explain his conduct by reference to his ready access to his mobile phone and sought to diminish the risk of further contraventions by pointing to his current employment as a fish processor. I accept that he would be unlikely to use his phone or engage in contravening conduct whilst actually undertaking the work of gutting fish. However, I am concerned by this aspect of his evidence because it assumes all too simplistically that a cause of the contraventions was his practical access to a mobile device such a phone. 70 I do accept that Mr Williams' life circumstances are somewhat less stressful as at the present day than they might previously have been. However, it is to be borne in mind that the factual impetus for contravening the TAS Act (namely his financial difficulties) has not been shown to be extraordinary, nor is it a circumstance that has wholly righted itself so as to support a finding that the contraventions are explained by external circumstances that cannot or will not arise again. When they do arise again, there is very little to suggest that Mr Williams will not respond to them in the same way. 71 In light of his past dealings with the Board, I do not consider the contraventions to be explained by a mere lapse of judgment. I am satisfied that Mr Williams has previously acted in breach of the Board's prior order and there is no dispute that he has previously engaged in dishonest conduct in the community resulting in a criminal conviction. That criminal conduct predated the civil contraventions by a short period. It appears that his involvement in the criminal justice system had no impact on his mental attitude toward compliance with the law. That is not to say that the civil penalty regime is an occasion to impose consequences on Mr Williams for prior conduct not forming the subject matter of the present proceeding. The prior conduct is nonetheless contextually relevant in the assessment of a penalty for the civil contraventions that is necessary and appropriate to bring about a significant attitudinal shift. 72 As the High Court emphasised in Pattinson, the seriousness of the contraventions may inform the Court's response in the sense that all of the circumstances of the past conduct may be considered in assessing an appropriate civil penalty to meet the statutory objective of deterrence. I have already observed that the financial gain from the contravention is not large in a quantitative sense. However, as I have emphasised, the seriousness of the contraventions is to be assessed not only by reference to the physical acts constituting the elements of the contravention, but by the mental state accompanying the doing of those acts. Viewed in that way, the contraventions are very serious because they involved a knowing defiance of the law over a significant period of time in circumstances where the foreshadowing and commencement of a civil penalty proceeding was ineffective in preventing further contravening conduct. 73 I have not overlooked Mr Williams' evidence that if he were to commit a like contravention again it would have a significant impact on his marriage. I have placed little weight on that assertion principally because it is lacking in context and detail. The Court does not know when Mr Williams' wife first learned of his contravening conduct, nor is there direct evidence about the objective circumstances upon which Mr Williams' assertion is based. 74 Nor have I overlooked expressions of regret and remorse made by Mr Williams in connection with the later conduct that constituted a contempt of the Court's orders. However, it is appropriate to assess his outward expressions of regret and remorse against the evidence as a whole. As discussed below, I am satisfied that Mr Williams has more recently gained an understanding that imprisonment for contempt of the Court's orders is a prospect that is very real and that he genuinely fears that consequence. However, I am presently concerned to deter Mr Williams from engaging in future civil contraventions for which no term of imprisonment can be imposed. The very real prospect of the imposition of financial penalties in the past has been insufficient to deter him. The assessment of penalties for the declared contraventions must be assessed against that background notwithstanding the expression of remorse for the latter conduct constituting the contempt. 75 There is otherwise a strong need to ensure that the penalty meets the objective of general deterrence with respect to like contraventions by others who might think it desirable to side step the regime for registration established under the TAS Act. As explained earlier in these reasons, its stated object is to ensure that tax agent services are provided to the public in accordance with appropriate standards of professional and ethical conduct and by persons who are fit and proper to provide them. The machinery by which that objective is maintained is the exclusion of those who are not fit and proper, and the subjection of tax agents to the standards of behaviour prescribed in Code. There is a strong need to deter contraventions of s 50-5(1) of the TAS Act given its importance to the efficacy of the regime as a whole in fulfilling the statutory purpose. The penalty should be such as to deter persons who may be tempted to charge fees for the provision of tax agent services whilst bypassing the registration process, including all of the prerequisites to it and responsibilities attending it. The need for general deterrence is highlighted by the facts of present case, involving a person who withdrew his renew application after a decision of the Board to the effect that his registration should be terminated and then commenced contravening behaviour about six months later. The case is not one in which Mr Williams could readily have secured registration had he applied. The absence of registration was not a mere administrative slip or technicality.

Submissions and outcome on civil penalties 76 The task of determining an appropriate penalty is sometimes said to involve an "instinctive synthesis" involving the evaluation of a multitude of factors, rather than by starting with a fixed figure and making arithmetical adjustments attributable to each factor: Tax Practitioners Board v HP Kolya Pty Ltd (2015) 232 FCR 34 (at [72]). 77 The Court may order a respondent to pay a civil penalty for each and every contravention. In this case, if the maximum penalty were to be imposed in respect of each contravention, the total penalty would amount to about $4 million. That sum could not be properly contemplated as an appropriate response. 78 The acts of preparing the 73 tax returns for fee or reward occurred by repetition of the same or similar activity. A group of acts of that kind may be regarded as a single course of conduct notwithstanding that they are each factually discrete. As Griffiths J explained in Australian Competition and Consumer Commission v Employsure Pty Ltd (No 2) [2021] FCA 1488 (at [79]): As noted above, rather than imposing separate penalties for each technically available contravention, the Court may, in its discretion, apply the 'course of conduct' or 'one transaction' principle. That principle recognises that, where there is an interrelationship between the legal and factual elements of two or more offences for which an offender has been charged, care must be taken to ensure that the offender is not punished twice for what is essentially the same criminality. Its application requires careful identification of 'the same criminality', which is necessarily a factually specific enquiry: see Cahill at [39]-[43] per Middleton and Gordon JJ). A court is not compelled to utilise the principle because '[d]iscretionary judgments require the weighing of elements, not the formulation of adjustable rules or benchmarks': see Royer v Western Australia [2009] WASCA 139 at [28] per Owen JA. Where utilised, the principle is almost always applied to separate events constituting contraventions, which have occurred over a period of time, as is the case here. Importantly, however, use of the principle does not convert the maximum penalty for one contravention into the maximum penalty for the course of conduct as a whole. (emphasis added) 79 See also Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (2017) 254 FCR 68 (at [115]) citing Construction, Forestry, Mining and Energy Union v Williams [2009] FCAFC 171; 191 IR 445 and Construction, Forestry, Mining and Energy Union v Cahill [2010] FCAFC 39; 194 IR 461. 80 I assess the penalty on the basis that the multiple contraventions together formed a part of a course of conduct occurring over a number of months. As emphasised in Employsure it does not follow that the maximum penalty that might otherwise be imposed is converted to that applicable to a single contravention. 81 In all of the circumstances I am satisfied that the penalty should be fixed in an amount that has a considerable financial impact on Mr Williams. There is a need in the present case to impress upon Mr Williams that contravening the TAS Act is not a solution to his financial difficulties but will only serve to exacerbate them. The imposition of a financial penalty will of course be a source of additional financial hardship, but that is a consequence contemplated by the TAS Act itself. The circumstance that a civil penalty occasions hardship does not mean it is imposed for a punitive purpose. 82 I have already observed that the evidence as to Mr Williams' financial position is stated at a level of generality, but he does have some equity in his home. I do not consider he has given a complete picture of all of the financial resources available to him, although there is some suggestion that he has loaned money from relatives including for the purpose of purchasing a car. 83 Counsel for Mr Williams submitted that the total penalty should be fixed in the amount of $25,000.00. I do not consider that amount to be sufficient to meet the objective of deterrence, especially given the findings I have previously made about Mr Williams' defiant attitude and especially the circumstance that he ignored the warning given by way of the cease and desist letter and gave a false response to it. The appropriate penalty is one that has a significant and memorable impact on Mr Williams' financial affairs. I do not consider the amount proposed by his Counsel would have that effect. 84 Mr Williams' submissions focused heavily on the circumstance that he charged only $100.00 for the preparation of each tax return and so received a fairly modest total amount of $7,300.00 in fees. It is correct to say that an appropriate penalty is one that deters prospective contraveners from regarding non-compliance with the law as a potentially profitable exercise. On that topic, I have had regard to authorities put forward by Mr Williams' Counsel indicating the penalties imposed in cases he sought to employ in a comparative way. I have derived little assistance from them. I am not persuaded that penalties should be fixed as a multiple of the financial gain derived from the contravention equivalent to a multiple derived mathematically from other cases. To proceed in that way would be to ignore fundamental features of this case. Moreover, I consider the low amount of financial gain is not the result of a conscious decision of Mr Williams to cease contravening the TAS Act. As such, the low financial gain is not a reliable indicator of the need for deterrence. 85 I consider that a penalty in the amount of $80,000.00 is more appropriate to bring about the insight necessary to influence Mr Williams' future behaviour. 86 I have reflected on the appropriateness of that figure as fairly addressing the totality of the conduct and am satisfied that it is not oppressive: Mill v The Queen (1988) 166 CLR 59 (at 62-63); Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith (2008) 165 FCR 560, Graham J (at [54]), Buchanan J (at [102]); QR Ltd v Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia [2010] FCAFC 150; 204 IR 142, Keane CJ and Marshall J (at [62]); Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union [2016] FCA 413,White J (at [61] - [62]). 87 For the Board it was submitted that penalties in the range of $100,000.00 to $120,000.00 should be imposed. In rejecting that submission I have accepted at face value that Mr Williams is not a man of significant financial means and I have assessed the impact of the penalty relative to his available assets and income so far as they are known. I am conscious that a penalty of $80,000.00 may be difficult to pay without selling assets, and I have had regard to that consequence. On the evidence before me, the imposition of the greater penalty sought by the Board will not result in a greater degree of deterrence. 88 There is insufficient evidence about Mr Williams' financial position to make a proper assessment about the risk of bankruptcy, to which Mr Williams adverted. Having been informed of the applicable penalties, the possible outcome of bankruptcy ought reasonably to have been within his contemplation when he took that risk. As I have said, those circumstances give rise to a heightened need for specific deterrence and if bankruptcy is a factual consequence of the imposition of penalties (which is not proven) then I would maintain the view that the total penalty of $80,000.00 is nonetheless appropriate. I emphasise that whilst the total penalty will cause significant financial hardship to Mr Williams, its purpose is not to inflict punishment or another form of retribution. 89 In fixing the appropriate penalty I have had regard to the circumstance that a final injunction will also be made, so introducing a threat of sanction for contempt of that order in the future. The financial penalty and the injunction will together serve the statutory purpose of deterrence.

Final Injunction 90 The power to grant an injunction is conferred by s 70-5 of the TAS Act: (1) If, on the application of the Board, the Federal Court is satisfied that you have engaged, or are proposing to engage, in conduct that would constitute a contravention of a civil penalty provision, the Federal Court may grant an injunction: (a) restraining you from engaging in the conduct; or (b) if in the Federal Court's opinion it is desirable to do so, requiring you to do something. 91 The injunction is expressed in terms that prohibit conduct that is otherwise prohibited by s 50-5(1) of the TAS Act. Of itself, that is not a basis upon which it is opposed by Mr Williams. He accepts that an ongoing injunction is appropriate. 92 Mr Williams submitted that an injunction in the terms sought should not be imposed in permanent and unqualified terms because its purpose is to ensure compliance with a law that may in the future be amended or abolished. 93 In determining whether or not to grant the final injunction I have had regard to the deterrent effect the civil penalties might also be expected to have. 94 In light of what I have said about the heightened need for deterrence I am satisfied that there should be an ongoing injunction, notwithstanding that the terms of injunction equate to the requirements of the law of general application, and notwithstanding that civil penalties are also to be imposed. 95 There is force in Mr Williams' submission that the prohibition in s 50-5(1) of the TAS Act may be repealed or abolished in the course of time so depriving the injunctive relief of its critical purpose. However, in my view, that circumstance can be accommodated by granting the parties liberty to apply to vary or revoke the injunction on the basis that it is no longer a reflection of the requirements of the law with respect to the preparation of tax returns in this country. 96 In addition, I consider that Mr Williams should have liberty to apply after a period of time to vary or revoke the injunction on the basis that he should no longer be subject to the threat of criminal sanction for its breach, particularly because of a demonstrable change in his mental attitude or character. The earliest time by which he should be permitted to exercise the liberty to apply should be 10 years. The order should be formulated in a way that has permanent effect subject only to the exercise of that liberty to apply. In that event, it will be Mr Williams' burden to prove that the injunction should be varied or revoked. 97 The Board has otherwise not sought any order prohibiting Mr Williams from renewing his application for registration as a tax agent at some time in the future. This Court should not be understood to prohibit any such application being made or to dictate its result.

Punishment for Contempt 98 This Court has the same power to punish for contempt as that possessed by the High Court for contempt of that Court: Federal Court of Australia Act 1976 (Cth), s 31. The power exists to vindicate and maintain the Court's authority: Australian Competition and Consumer Commission v Info4pc.com Pty Ltd (2002) 121 FCR 24 (at [141]). As McHugh J observed in Pelechowski v Registar, Court of Appeal (NSW) (1999) 198 CLR 435 (at [88]): .. If breaches of the orders of the courts were regarded as of little moment, respect for and observance of the law would inevitably deteriorate and, ultimately, pose a threat to social order. (footnote omitted) 99 The penalties may (relevantly) include a fine, or a term of imprisonment that may be suspended subject to conditions, or a combination of those alternatives: Info4pc (at [138]); Australian Competition and Consumer Commission v Halkalia Pty Ltd (No 3) [2017] FCA 522 (at [140]); Tax Practitioners Board v Hacker (No 3) [2020] FCA 1814 (at [126]). 100 In Vaysman v Deckers Outdoor Corporation Inc [2011] FCAFC 17; 276 ALR 596, Gray J (at [54]) emphasised that imprisonment for contempt should be regarded as a penalty of last resort, as "[a]ny period of deprivation of liberty is a drastic imposition on anyone". Accordingly, his Honour said, "[i]t is incumbent on a sentencing judge to determine first whether any alternative to imprisonment would be appropriate". 101 The circumstances that may be taken into account were identified non-exhaustively by Mansfield J in Director of the Fair Work Building Industry Inspectorate v Cartledge (No 2) [2015] FCA 851 as follows (at [6]): • the contemnor's personal circumstances; • the nature and circumstances of the contempt; • the effect of the contempt on the administration of justice; • the contemnor's culpability; • the need to deter the contemnor and others from repeating contempt; • the absence or presence of a prior conviction for contempt; • the contemnor's financial means; and • whether the contemnor has exhibited general contrition and made a full and ample apology.

Nature and circumstances of the contempt 102 Pursuant to s 70-5(2) of the TAS Act, on 18 June 2021 the Court made an order imposing an interim injunction pending the trial of the originating application on the following terms: Until the hearing and determination of the application or further order, the respondent be restrained from preparing and lodging income tax returns for taxpayers, for a fee or other reward, whilst not a registered tax agent within the meaning of the Tax Agent Services Act 2009 (Cth). 103 Mr Williams consented to the Injunction being made after being personally served on 15 June 2021 with the material upon which the Board proposed to rely in support of it. 104 The Court made orders granting the injunction on 18 June 2021. The order with the Injunction was sent to Mr Williams by email. It contains a prominent penal notice in the following terms: PENAL NOTICE TO: NATHAN LUKE WILLIAMS IF YOU: (A) REFUSE OR NEGLECT TO DO ANY ACT WITHIN THE TIME SPECIFIED IN THIS ORDER FOR THE DOING OF THE ACT; OR (B) DISOBEY THE ORDER BY DOING AN ACT WHICH THE ORDER REQUIRES YOU TO ABSTAIN FROM DOING, YOU WILL BE LIABLE TO IMPRISONMENT, SEQUESTRATION OF PROPERTY OR OTHER PUNISHMENT FOR CONTEMPT. ANY OTHER PERSON WHO KNOWS OF THIS ORDER AND DOES ANYTHING WHICH HELPS OR PERMITS YOU TO BREACH THE TERMS OF THIS ORDER MAY BE SIMILARLY PUNISHED. 105 The Court conducted a case management hearing on 29 July 2021. By that time, Mr Williams had already engaged in the conduct constituting the contempt. He had also executed the statement of agreed facts containing admissions as to the civil contraventions. It was at the case management hearing, the Court provided Mr Williams with guidance concerning his right to claim privilege against self-incrimination and self-exposure to penalty. It informed the parties that the Court's orders should not be understood as abrogating that right. It informed the parties that Mr Williams may claim the privilege, and that if he were to do so the Court would consider what ramifications should follow for the Board's foreshadowed reliance on the statement of agreed facts as the mechanism for proving its case with respect to the civil contraventions. I indicated to Counsel for the Board that it may be necessary for the Board to prove its case on the basis of affidavit evidence should circumstances arise precluding it from acting on Mr Williams' admissions. The Court made orders progressing the matter for a hearing with respect to the civil contraventions then set down for December 2021. 106 On 25 August 2021 Mr Williams received a letter from the Board advising that it had obtained evidence that he had continued to prepare and lodge tax returns for fee or reward following 18 June 2021 in breach of the Injunction. 107 On 5 October 2021, Mr Williams was personally served with an interlocutory application filed 29 September 2021 alleging the contempt together with a statement of the charge and seven supporting affidavits. 108 That interlocutory application had been set down for case management hearing on 14 October 2021. 109 Prior to the hearing, the parties consented to orders in terms sought on the interlocutory application adjudging Mr Williams guilty of the contempt in the terms alleged. The facts constituting the contempt are recorded in [4] - [10] of the statement of charge and are as follows: Charge 4. On 5 July 2021 and in wilful breach of the Order, the Respondent prepared and lodged the income tax return for the year ended 30 June 2021 of [redacted], in return for a fee or other reward. PARTICULARS The Respondent prepared and lodged the income tax return electronically, using [redacted] MyGov login details. The Respondent charged a fee or other reward of $100 and received it, constituted by a payment made by [redacted] to the Respondent on 5 July 2021 by way of electronic transfer. 5. On 22 July 2021 and in wilful breach of the Order, the Respondent prepared and lodged the income tax return for the year ended 30 June 2021 of [redacted], in return for a fee or other reward. PARTICULARS The Respondent prepared and lodged the income tax return electronically, using [redacted] MyGov login details. The Respondent charged a fee or other reward of $100 and received it, constituted by a payment made by [redacted] to the Respondent on 22 July 2021 by way of electronic transfer. 6. On 23 July 2021 and in wilful breach of the Order, the Respondent prepared and lodged the amended income tax return for the year ended 30 June 2020 of [redacted], in return for a fee or other reward. PARTICULARS The Respondent prepared and lodged the amended income tax return electronically, using [redacted] MyGov login details. The Respondent charged a fee or other reward of $100 and received it, constituted by a payment made by [redacted] to the Respondent on 23 July 2021 by way of electronic transfer. 7. On 23 July 2021 and in wilful breach of the Order, the Respondent prepared and lodged the income tax return for the year ended 30 June 2021 of [redacted], in return for a fee or other reward. PARTICULARS The Respondent prepared and lodged the income tax return electronically, using [redacted] MyGov login details. The Respondent charged a fee or other reward of $100 and received it, constituted by a payment made by [redacted] to the Respondent on 23 July 2021 by way of electronic transfer. 8. On 23 July 2021 and in wilful breach of the Order, the Respondent prepared and lodged the amended income tax return for the year ended 30 June 2020 of [redacted], in return for a fee or other reward. PARTICULARS The Respondent prepared and lodged the amended income tax return electronically, using [redacted] MyGov login details. The Respondent charged a fee or other reward of $100 and received it, constituted by a payment made by [redacted] on behalf of [redacted], to the Respondent on 23 July 2021 by way of electronic transfer. 9. On 23 July 2021 and in wilful breach of the Order, the Respondent prepared and lodged the income tax return for the year ended 30 June 2021 of [redacted], in return for a fee or other reward. PARTICULARS The Respondent prepared and lodged the income tax return electronically, using [redacted] MyGov login details. The Respondent charged a fee or other reward of $100 and received it, constituted by a payment made by [redacted] on behalf of [redacted], to the Respondent on 23 July 2021 by way of electronic transfer. 10. On 23 July 2021 and in wilful breach of the Order, the Respondent prepared and lodged the income tax return for the year ended 30 June 2021 of [redacted], in return for a fee or other reward. PARTICULARS The Respondent prepared and lodged the income tax return electronically, using [redacted] MyGov login details. The Respondent charged a fee or other reward of $100 and received it, constituted by a payment made by [redacted], to the Respondent on 30 July 2021 by way of electronic transfer. 110 As can be seen, the instances of contempt occurred over a short period of time and there is no evidence of further breaches after 23 July 2021. 111 I have earlier mentioned that Mr Williams was self-represented for most of the period leading up to the hearing date originally fixed at 15 December 2021 when he appeared through his Counsel. In an affidavit since filed he said that he did not fully understand the guidance that had been provided to him on 29 July 2021 concerning his right to claim privilege against self-incrimination or self-exposure to penalty. I have had regard to that evidence, however, his lack of understanding of the guidance given on that day has not been put forward to explain the conduct constituting the contempt, nor is it relied upon as a basis to withdraw admissions he has made as to the conduct constituting the contempt. Mr Williams was given guidance to the effect that he may articulate a claim of privilege in a way that might preclude the Board from relying on the statement of agreed facts that had at that time already been executed and filed. As I have mentioned, the contempt had already occurred at the time that the guidance was given and so could not have influenced Mr Williams' behaviour at the earlier time. 112 The purpose of the adjournment granted on 15 December 2021 was to enable Mr Williams to obtain legal advice and I am satisfied that he has had every opportunity to address the Court about the quality and effect of his prior admissions and to make submissions to the effect that the orders adjudging him guilty of contempt ought not to have been made on the basis of them.

Mr Williams' evidence 113 In his affidavit, Mr Williams said: 82. I engaged in the tax returns for the financial year ending 30 June 2021, which is the subject of the Contempt Application, mainly out of desperation to look after my family financially. At the time, I was recently out of work as a result of stress and I was not receiving an income. Around this time, I had arranged for employment with my brother, but that employment fell through. I did not gain employment again until I was employed at my current job. 83. I also felt pressure from the people who approached me to complete their tax returns for them. Annexed hereto and marked NLW-12 are two screenshots of text messages showing people approaching me and asking me to do their tax returns. 114 He went on to say: 84. I am extremely remorseful for engaging in the conduct in contempt of the Court's orders. I did not fully appreciate the gravity of my conduct at the time I assisted with lodging the tax returns, but have now come to understand the seriousness of having breached the Court's orders. That the Applicant is seeking that I be imprisoned scares me. 115 Mr Williams referred to the circumstance that he had removed himself from the accountancy profession which had improved his mental health. He expressed an apology to the Court and repeated that he had not appreciated the gravity of acting in breach of the Court's orders and that he now understand the seriousness of what he had done. Mr Williams expressed concern about the effect that any fine, penalties and costs orders would have on him and his family and asked the Court to be merciful and allow him an opportunity to "build on the recent progress" he had made. 116 Mr Williams is the father of two children born in 2016 and 2020. He said that he feared a custodial sentence would impact on his employment and his relationship with family members, including by exacerbating marital difficulties (about which no detail was provided). 117 He reiterated that he felt pressured to prepare tax returns and relied upon text messages with clients in support. One of the text message exchanges occurred on 9 July 2020 more than 12 months before the contempt and the other exchange is undated. In the text message exchanges the clients do not employ language applying pressure on Mr Williams. Rather, they ask whether he can prepare their tax returns and Mr Williams responds agreeably.

Submissions and consideration 118 The Board submitted that the Court should impose a short term of imprisonment of 14 days. 119 I accept Mr Williams' evidence that he did not fully appreciate that a breach of the Court's orders was a very serious matter, notwithstanding that he received a copy of the orders with the Injunction after consenting to them, and notwithstanding that the order contained a penal notice in the terms set out above. That finding does not mean that Mr Williams was ignorant of the fact that the order was made or ignorant of its meaning. Mr Williams did not go so far as to suggest that he was unaware that his conduct on 5 July 2021, 22 July 2021 and 23 July 2021 was in breach of the order. I find that he did have that awareness. What he lacked was an appreciation of the seriousness with which the Court may view his conduct and an appreciation that a term of imprisonment may be imposed in respect of it. He now urges the Court not to impose a term of imprisonment because that is what he most fears. 120 As a matter of specific deterrence, I consider that the prospect that a term of imprisonment may be imposed in respect of future conduct constituting a contempt of the Court is a relevant factor. However, unlike the civil penalty regime, the need to ensure specific deterrence is not the only purpose of the Court's power to punish for contempt. In this case, considerations of general deterrence and punishment are significant. 121 The conduct constituting the contempt occurred against a background of repeated contraventions of the TAS Act that the threat of civil penalty proceedings had been ineffective to discourage. It was not suggested by Mr Williams that he misunderstood the purpose of the Injunction, being to cease his contravening conduct. Viewed in context, I consider the conduct constituting the breach of the Injunction to be very serious because it demonstrates an absolute disregard for the authority of the Court. The explanation for the contempt is the same as that put forward to explain the civil contraventions, namely, straitened financial circumstances and asserted pressure from tax payers. I reject the assertion that the contempt is explained or justified in any way by pressure asserted by the tax payers themselves. The motivating factor on Mr Williams' part was to gain money for conduct that, I find, he knew to be in breach of the Court's order. The Court has previously found that the breach of its orders was wilful and there was no application to revisit that finding. To the extent that Mr Williams was ignorant, he was ignorant of the seriousness with which the Court may view the contempt. I do not consider that to be a sufficient reason to avoid imposing upon Mr Williams a penal consequence that is appropriate to punish his knowing breach of the Court's order. 122 The need for general deterrence in the present case is pressing. The Court has an important role to play in the enforcement of a number of regulatory regimes established by the Parliament. The making of orders to ensure compliance with the regime established by the TAS Act is made plain in s 70-5. An injunction made under that provision is intended to provide for additional consequences for contravening conduct (deriving from the Court's own powers) over and above the civil penalty regime. 123 In all of the circumstances, I do not consider the imposition of a fine to be an adequate punishment for the contempt, even if the evidence was sufficient to show that Mr Williams had the capacity to pay. Nor do I consider the imposition of a fine to serve the legitimate purpose of general deterrence in the present case. It is true that a fine might be such as to make a breach of the Court's orders a commercially unpalatable risk. But as the present case shows, there is a class of persons (of whom Mr Williams is one) who are prepared to take considerable risks in contravening the law even where the chance of detection is very high. More fundamentally, the purpose of the power to punish for contempt is one that is concerned to protect and maintain the administration of justice more generally by reinforcing the Court's authority. I am satisfied that Mr Williams knowingly ignored and so disrespected the Court's authority, albeit in circumstances where he misjudged the seriousness with which the Court would view his conduct. 124 I have carefully considered the impact that a term of imprisonment would have in terms of the deprivation of Mr Williams' personal liberty. That impact necessarily varies according to the length of the sentence. The deprivation of personal liberty is a serious consequence and it is for that reason that I consider the term of imprisonment should be short, but nonetheless sufficient to impress upon Mr Williams and others the importance of compliance with orders made under the TAS Act that buttress the regime, and to discourage conduct that undermines the Court's authority more generally2. 125 In the circumstances described I am satisfied that the imposition of a fine is insufficient and that a period of 10 days imprisonment is appropriate. 126 The term is arrived at after careful regard to Mr Williams' degree of cooperation in this proceeding, particularly his conduct in not disputing the facts alleged in the statement of charge and his compliance generally with the procedural orders of the Court. Cooperation in the present legal context is relevant for purposes other than the assessment of specific deterrence, to which my reasons in relation the civil penalties principally relate. Were it not for the significant degree of cooperation by Mr Williams the term of imprisonment would have been 21 days, more than twice as long as that now contemplated. I emphasise that the degree of cooperation (after the conduct constituting the contempt) has been taken into account so as encourage cooperative conduct of future contraveners and to facilitate the administration of justice more generally. 127 I have had regard to the possibility that a custodial sentence may impact negatively on Mr Williams' family relationships however there is very little detail on that topic in the evidence and on the material before me I am not satisfied that his subjective fears of divorce are objectively supported by the evidence. Nor is there sufficient evidence to support a finding that a short term of imprisonment would affect Mr Williams' prospects of employment to a significant degree over and above the reputational impact of the finding of guilt. Whilst Mr Williams will be unable to derive an income during the short term of imprisonment, on the limited material before me I am not satisfied that the sentence will result in the termination of any existing employment. 128 A term of imprisonment may be suspended. However in the present case I do not consider that the impacts of a short custodial sentence are such as to warrant suspension. Whilst I accept that Mr Williams is the father of two young children, that of itself is not a sufficient reason to suspend the sentence, especially in the absence of evidence about the extent of tangible and practical impacts the short term of imprisonment may have upon them. 129 The Court may in its discretion defer the date upon which the term of imprisonment should commence so as to reduce the impact it may have on third persons, including family members. The parties will be heard as to the form of orders, including deferral of the commencement of imprisonment to a date falling outside the time by which Mr Williams may commence any appeal from the orders.

Costs 130 The Board seeks its costs of and incidental to the whole of the proceeding. It submits that the costs of the application for the imposition of penalties for contempt should be awarded on an indemnity basis. 131 Counsel for Mr Williams submitted that costs should be capped in the amount of $15,000.00 because, among other things, the Board had expended costs in the preparation of affidavits that were unnecessary in the proceeding given the degree of Mr Williams' cooperation. 132 The Board's supporting affidavits were all filed with the originating application and included affidavits from the tax payers affected by the contraventions. Mr Williams submitted that his execution of a statement of agreed facts for the purposes of s 191 of the Evidence Act is an indication that he would have agreed facts and admitted liability prior to the commencement of the proceeding if he had been approached to do so, so rendering the work of affidavit preparation unnecessary. 133 I do not accept that submission for two reasons. First, the reasons why Mr Williams executed the statement of agreed facts and the earliest time at which he might have been willing to do so are questions of fact about which I have no evidence. It may well be the case that he executed the statement of agreed facts upon reading the affidavit material and forming a view about the merits of the Board's case. Second, it is plain on the facts that Mr Williams' conduct in his dealings with the Board after receiving the cease and desist letter was far from cooperative. Notwithstanding the threat of this action, he denied engaging in the contravening conduct and persisted with it. In the circumstances described, the Board was under no obligation to again warn Mr Williams that litigation might be commenced or to invite him to make admissions in advance of them. Mr Williams should be liable for the Board's costs of preparing the originating application including all of the accompanying affidavits in support. 134 Next, it was submitted that if the quantum of costs was not fixed, it would constitute a further penalty referable to Mr Williams' contravening conduct. I do not accept that submission as a matter of law. The purpose of the costs order is to compensate the successful party, not to inflict punishment: Latoudis v Casey (1990) 170 CLR 534, Mason CJ (at 543), McHugh J (at 567). The circumstance that a costs order may have a significant financial impact upon a person does not mean that it is made for a punitive purpose. 135 It was also submitted that it was likely that the parties could have reached an agreement with respect to the quantum of civil penalties so rendering the hearing with respect to remedies unnecessary. Whether or not that is so is unknown to the Court. The remedies ultimately awarded in the proceeding are considerably in excess of what Mr Williams contended for and there is no evidence that he made any attempts to avoid the costs of the hearing by urging the Board to agree to a compromised position resembling the ultimate outcome. Whilst the penalties are less than that sought by the Board I do not consider that circumstance to be sufficient to avoid making an order that Mr Williams pay the Board's costs of and incidental to the whole of the proceeding. 136 I do not otherwise consider there to be a proper basis for awarding costs of the contempt aspect of the hearing on an indemnity basis. The circumstance that the Board was successful in obtaining orders to the effect sought is not sufficient of itself to justify such an order. Mr Williams did not act unreasonably in resisting the orders sought by the Board having regard to the breadth of the Court's discretion and the importance of his personal liberty. 137 Having regard to all of the circumstances, I consider that the Board should be awarded its costs to be taxed on a party-party basis, if not agreed. I certify that the preceding one hundred and thirty-seven (137) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Charlesworth.

Tax Agent Services Act 2009(Cth)ss 2-5, 20-5, 30-20, 50-5, 50-35, 70-5, 90-5

Crimes Act 1914(Cth)s 4AA, s 4AA(1).

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